Lesson Learned From the Yahoo Hack: Identity is the Currency of Trust

Data breaches have become a recurring and all-too-familiar story of late, making it easy for our eyes to glaze over at the latest announcement of millions of stolen customer credentials. Yet it’s hard to ignore yesterday’s announcement from Yahoo that more than 1 billion user identities were stolen from the company in 2013.

The outcome for Yahoo could be disastrous. A pending acquisition of the company by Verizon Communications could be at risk. The FBI is investigating. And some security experts are advising people to stop using services such as Yahoo Mail.

The biggest loss for Yahoo, in my view, is trust.

In the online world, customers need to share their identity – email addresses, personal preferences, credit card numbers, etc. – to connect with the businesses that provide them goods and services. If customers can’t rely on a business to protect that data, then trust is lost. In other words, identity is the currency of trust.

Yahoo undoubtedly could have done a better job of protecting customer data, but breaches can happen to anyone – there is no magic bullet in security, and no organization should regard their infrastructure as impenetrable.

One of our most important goals at Gigya is helping our clients improve the protection of the customer information they possess. Our cloud-based platform is purpose-built for securing identity data and supports new methods of authentication – such as biometrics – that will ultimately replace today’s weak username/password approach. We’re always looking for improvements – such as our announcement last month of Network Protected Identity.

Trust is earned in drips and lost in buckets. As the Yahoo hack dramatically illustrates, every business that wants to build online relationships needs to make protecting customer identity a priority – or risk losing trust in an instant.